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TROW or ARES: Which Is the Better Value Stock Right Now?
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Investors interested in stocks from the Financial - Investment Management sector have probably already heard of T. Rowe Price (TROW - Free Report) and Ares Management (ARES - Free Report) . But which of these two stocks offers value investors a better bang for their buck right now? We'll need to take a closer look.
There are plenty of strategies for discovering value stocks, but we have found that pairing a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system produces the best returns. The Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.
Right now, T. Rowe Price is sporting a Zacks Rank of #2 (Buy), while Ares Management has a Zacks Rank of #4 (Sell). The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that TROW has an improving earnings outlook. But this is just one piece of the puzzle for value investors.
Value investors also tend to look at a number of traditional, tried-and-true figures to help them find stocks that they believe are undervalued at their current share price levels.
The Style Score Value grade factors in a variety of key fundamental metrics, including the popular P/E ratio, P/S ratio, earnings yield, cash flow per share, and a number of other key stats that are commonly used by value investors.
TROW currently has a forward P/E ratio of 12.62, while ARES has a forward P/E of 41.83. We also note that TROW has a PEG ratio of 1.71. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. ARES currently has a PEG ratio of 1.87.
Another notable valuation metric for TROW is its P/B ratio of 2.50. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. For comparison, ARES has a P/B of 10.24.
These metrics, and several others, help TROW earn a Value grade of B, while ARES has been given a Value grade of F.
TROW has seen stronger estimate revision activity and sports more attractive valuation metrics than ARES, so it seems like value investors will conclude that TROW is the superior option right now.
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TROW or ARES: Which Is the Better Value Stock Right Now?
Investors interested in stocks from the Financial - Investment Management sector have probably already heard of T. Rowe Price (TROW - Free Report) and Ares Management (ARES - Free Report) . But which of these two stocks offers value investors a better bang for their buck right now? We'll need to take a closer look.
There are plenty of strategies for discovering value stocks, but we have found that pairing a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system produces the best returns. The Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.
Right now, T. Rowe Price is sporting a Zacks Rank of #2 (Buy), while Ares Management has a Zacks Rank of #4 (Sell). The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that TROW has an improving earnings outlook. But this is just one piece of the puzzle for value investors.
Value investors also tend to look at a number of traditional, tried-and-true figures to help them find stocks that they believe are undervalued at their current share price levels.
The Style Score Value grade factors in a variety of key fundamental metrics, including the popular P/E ratio, P/S ratio, earnings yield, cash flow per share, and a number of other key stats that are commonly used by value investors.
TROW currently has a forward P/E ratio of 12.62, while ARES has a forward P/E of 41.83. We also note that TROW has a PEG ratio of 1.71. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. ARES currently has a PEG ratio of 1.87.
Another notable valuation metric for TROW is its P/B ratio of 2.50. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. For comparison, ARES has a P/B of 10.24.
These metrics, and several others, help TROW earn a Value grade of B, while ARES has been given a Value grade of F.
TROW has seen stronger estimate revision activity and sports more attractive valuation metrics than ARES, so it seems like value investors will conclude that TROW is the superior option right now.